Jointly and Severally Liable Question

[jkbcash]

What is the name of your state (only U.S. law)? Georgia

Hi. I am involved in a lawsuit where I am one of the defendants. I am a real estate agent and represented the buyer who is the plaintiff. The seller of the house was supposed to make repairs to the house that I sold to the plaintiff, however, failed to do so. In an attempt to salvage the deal I told my client/plaintiff I would pay for the repairs in the event they could not get the seller to make the repairs. The seller did not make the repairs and 2 years my client is suing me for the repairs. I made the mistake of signing an agreement acknowledging I would make the repairs. I admit I made a mistake, however the plaintiff asked me for a sum of money that was well over what it would take to make the repairs. The plaintiff is suing myself and the brokerage I was working for at the time. The agreement was drawn up on a loose-leaf piece of paper outside of any real estate form, and my old brokerage was not aware of the agreement, nor were they mentioned in anywhere on the agreement.

The plaintiff is saying that the brokerage is jointly and severally liable for the payment of the repairs. Are they correct? If the brokerage had no knowledge of the agreement and were not mentioned in the agreement, how could they be held jointly and severally liable?

Thank you in advance for any help or light you are able to shed on this.

Justin

 

[HRZ]

THe prior brokerage firm needs to sort out its own exposure...you would be best to focus on your personal exposure .

I have no idea what the actual cost to make the repairs was..but do you?

( I be done enough repairs to know that sometimes the cost is 10x what you might think it to be )

I am not sure if you were not a sub agent of the sellers agent ....and I am not sure if this deal survived closing under the doctrine of merger...are you?

 

[Taxing Matters]

The plaintiff is saying that the brokerage is jointly and severally liable for the payment of the repairs. Are they correct? If the brokerage had no knowledge of the agreement and were not mentioned in the agreement, how could they be held jointly and severally liable?

Thank you in advance for any help or light you are able to shed on this.

I’ll repeat for you here the answer I gave you on another forum. The plaintiff may well succeed in holding the brokerage firm liable. A well established principle of the common law is respondeat superior, a Latin phrase that translates as “let the master (superior) answer”. Under this doctrine, an employer is liable for the acts of his/her employees that are done within the scope of employment. Assuming you were an employee or dependent agent of the broker the broker is liable for those things you did in the course of your employment with the broker, whether or not the broker was aware of those acts. In the course of acting as the buyers agent you made a promise to pay for certain repairs, a promise that in effect also ended up binding the broker for whom you worked as a result of this doctrine.

Alternatively, the plaintiff could argue that since you were an agent of the broker the broker is liable under a theory of implied authority to bind the broker to contracts. If sales people generally have the authority to bind the broker for whom they work to contracts with customers then the buyer would rightfully assume you had that authority and were acting with the implied authority of the brokerage firm when you made the deal to pay for the repairs.

Either way, the broker may well get stuck with a judgment for these repairs along with you. Note that the fact that the agreement was not on some more official form does not matter. Indeed, the agreement did not have to be in writing at all to be a binding contract. But of course the fact that you did put it in writing makes it all that much easier for the plaintiff to prove the contract. You should not have made that deal without being really sure that you and your employer would be willing and able to perform on your end of it.

 

[HRZ]

THere is probably no mistake at all involved...for an agent to cover the costs of a lighting fixture or drapery rods or handrail repair etc are rather common to move a deal forward and close.

I doubt you were a true exclusive buyers agent paid by buyer ...but that's a debate for the brokerage firms .

Taxing Matters is usually right on target....and here it is likely too.

You best be looking at your liability insurance coverage and any agreements with prior brokerage that might hold them harmless at your expense.

Personally , if this contract formed part of the overall deal to get it sold , I'd be asking my counsel if it survived closing under the doctrine of merger. OF course as buyer my view would be you and your broker get to cure it.